Layoffs by state and local governments are poised to take off again, threatening the picture of growth that President Barack Obama has been touting in the past few months of monthly jobs reports.

Job slashed on the local level have slowed for the past few months, but with new budgets beginning to get fashioned and economic conditions continuing to sap treasuries, economists expect that’s about to change. New rounds of public employee layoffs would cut into the gains from increased private-sector hiring.

“We have a long way to go before we can use the word ‘recovery’ to describe local governments,” said Chris Hoene, director of research at the National League of Cities. “The budget impacts of the decline in the housing market are still playing out and likely have another year or so to go.”

States and municipalities slashed their payrolls by 647,000 jobs since the middle of 2008, yet things began to brighten in February and January, when school districts and state universities added a combined 22,000 jobs, the Labor Department reported Friday. That more than offset the continued pink slips for law enforcement, parks and transportation workers.

But experts say the uptick will be brief, with layoffs resuming as states reach the end of their fiscal years and schools let out for summer. Between June and July of last year, state and local governments fired 72,000 workers.

The 2009 stimulus helped triage state and local government finances, and as its effects wore off, the president proposed another $35 billion in federal spending this past September that was pretty much dead on arrival with the Republican-majority House.

Some of the hardest hit include electoral battlegrounds of Colorado, Florida, Missouri, Nevada, New Hampshire, Ohio and Wisconsin, which face a combined budgetary shortfall of $11.35 billion, according to the Center on Budget and Policy Priorities, a progressive think tank.

Obama met on Monday afternoon with several municipal government officials, including Ted Ellis, mayor of Bluffton, Ind., and president of the National League of Cities. Ellis left the meeting, saying Congress is the main obstacle to receiving fiscal aid because of its obsession with the deficit and maneuvering for the 2012 elections.

“I’m not sure we heard anything there that we didn’t expect — that the administration lines up with cities pretty well on most of the issues,” Ellis said. “But when it comes to funding, that comes from Congress, and therein lies our challenge.”

— Josh Boak

Wall Street POLITICO is a weekly column looking at issues that drive business.